Connecticut General Statutes 12-704g – Modification to Connecticut adjusted gross income for certain venture capital income
(a) As used in this section:
Terms Used In Connecticut General Statutes 12-704g
- Adjusted gross income: means the adjusted gross income of a natural person with respect to any taxable year, as determined for federal income tax purposes and as properly reported on such person's federal income tax return. See Connecticut General Statutes 12-701
- Commissioner: means the Commissioner of Revenue Services or his authorized agent. See Connecticut General Statutes 12-701
- Partner: means a partner as defined in Section 7701(a)(2) of the Internal Revenue Code and the regulations adopted thereunder, as from time to time amended, and any reference in this chapter or in regulations adopted under this chapter to a partner shall include a member of a limited liability company that is treated as a partnership for federal income tax purposes. See Connecticut General Statutes 12-701
- Taxable year: means taxable year as determined in accordance with section 12-708. See Connecticut General Statutes 12-701
(1) “Bioscience investment ratio” means a ratio, the denominator of which is the total amount of capital raised by a qualified venture capital fund, and the numerator of which is the total amount of money invested by such fund in Connecticut bioscience businesses;
(2) “Connecticut bioscience business” means any business with its principal place of business in Connecticut that is engaged in (A) the manufacture of pharmaceuticals, medicines, medical equipment, medical devices and analytical laboratory instruments, (B) the operation of medical or diagnostic testing laboratories, or (C) the conducting of pure research and development in life sciences;
(3) “General partner” means a general partner, as defined in section 12-213; and
(4) “Qualified venture capital fund” means a venture capital fund, as defined in 17 C.F.R. § 275.203(l)-1, as amended from time to time, that is established on or after January 1, 2018.
(b) A general partner of a qualified venture capital fund shall be allowed a deduction from such general partner’s adjusted gross income for purposes of the tax imposed under this chapter. Such deduction shall be calculated as follows:
(1) The amount of income received by a general partner of a qualified venture capital fund from the sale, transfer, exchange or other disposition of any form of such fund’s equity interests in a Connecticut bioscience business obtained from investments made by such fund in such business on or after January 1, 2018; plus
(2) The amount of income received by such general partner for the management of such fund, except the income described in subdivision (1) of this subsection, multiplied by such fund’s bioscience investment ratio on the last day of the taxable year.
(c) The Commissioner of Revenue Services shall adopt regulations, in accordance with the provisions of chapter 54, to implement the provisions of this section.